The second Vanguard Annual Banking award is slated th April 2008. The award which is open to the 24 existing bank in the country was instituted last year by the Publish of the Vanguard News paper Mr. Sam Amuke popularly known in the early 70s as sad Sam. The awards is aimed at giving recognition to Nigerian banks in areas they have excelled in service delivery to the banking public.
As part of the globalisation effort of Nigeria banks, some are already looking outside the shores of Nigeria. Already Union Bank, Intercontinental, GTbank, Zenith, Oceanic, UBA and others have open branches in Ghana and other West Africa countries. Some have targeted South Africa and East Africa. The bold move by Nigeria banks to venture off the shores of Nigeria is as a result of the confidence they now enjoy in the international fora. In the last one year close to ten Nigeria banks have ranked among the 1,000 top global banks.
The banking sector, today, is the fastest growing in Africa and with monetary authorities vision to make Nigeria the financial hub of Africa, and with its Financial Strategy 2020, in the works, the banks will continue to play leadership roles in the economy. It is the dominant sector in the Stock Exchange and the dominant driver of the progress at the Nigerian capital market.
Not surprising, the banking sub-sector accounted for 17 of the top 20 companies by turnover volume. As in 2005, the sub-sector recorded many block trades as shareholders realigned their portfolios after the consolidation programme and speculators took profit on some banking stocks.
The total market value of 288 securities listed on The Exchange increased by 76.55 per cent to stand at N5.12 trillion by year-end. The listing of new securities (equities and bonds) explains in large part the growth of the market capitalisation during the year. The banking sub-sector recorded many supplementary issues and the listing of scheme shares arising from the mergers and acquisitions elicited by the industry consolidation.
Improved activity in the Primary Market throughout the year arose principally from the increased recourse to the stock market by companies and the Federal Government, consequent upon the high lending rates in the money market and the slow down in banking operations at the height of the banking sector reform.
In 2006, The Exchange considered and approved 62 applications for new issues and mergers & acquisitions valued at NI .41 trillion, as against 52 applications for new issues valued at N730.54 billion in 2005.
The non-bank corporate issues accounted for 48 per cent of the new issues approved in 2006, with 40 applications valued at N678.54 billion, while the banking sector accounted for 41 per cent with 21 applications valued at N577 billion. The Federal Government bond issue accounted for NI 55 billion or 11 per cent of the total amount approved during the year
Further analysis of new issues approved in 2006 showed that the sum of N117.4 billion was raised through Initial Public Offering (lPO); N95.7 billion through supplementary issues; N53.8 billion through rights issues; and N168.5 billion through bonds issue, including the Federal Government bond.
In value terms, the bulk of the approvals in the banking sector were for mergers and acquisitions, for which 13 applications valued at N369 billion were considered. This accounted for 26 per cent of the total value of approvals during the year.
The sore point however is with the Alliance Bank group of 14 banks which the CBN withdrew their operating licences are still engrossed in legal battle with the apex bank one full year after consolidation.
